Kiwi Property delivered a solid result in the six months to 30 September 2019, progressing its new strategy and achieving a sound financial performance. We’re in a good position to drive growth, with a high-quality asset portfolio, robust development pipeline and an outstanding team of property professionals, committed to creating value for our stakeholders.
Hear Kiwi Property Chief Executive Officer, Clive Mackenzie, discuss our half-year result and the recent progress we’ve made on the delivery of our mixed-use strategy.
We recorded net rental income of $89.6m in the six months to 30 September 2019. This is down slightly on the comparative period due to the impact of the sale of North City. When viewed on a like-for-like basis however, net rental income grew $1.8m or 2.1% on last year.
Net profit after tax declined to $36.8m due to a fair value loss of $12.9m on our interest rate swaps, following successive recent interest rate cuts. In parallel however, these same cuts are having a favourable impact on our weighted average cost of debt.
Funds from Operations (FFO), the company’s measure of operating performance was $51.9m for the period. As expected, this figure is down slightly on the year before, reflecting the impact of one-off disposals in the previous period.
FFO is a non-GAAP measure. Refer to the half-year result presentation for definitions.
The board has declared a half-year cash dividend of 3.525 cents per share for the six months ended 30 September 2019, up from 3.475 cents per share in the prior period. The dividend is scheduled for payment on 18 December 2019.
The board continues to project the cash dividend for the year ending 31 March 2020 to be 7.05 cents per share (absent material adverse events or unforeseen circumstances).
Our property portfolio increased in value through the first half of the 2020 financial year, driven by significant development activity. In addition, we made strategic acquisitions adjacent to Sylvia Park, creating significant scope for future mixed-use development.
We delivered robust rental growth through the first half of the year with new leasing and rent reviews up 4.6%. This has been driven by intensive asset management and leasing activity, resulting in strong rental uplift at the Vero Centre, Sylvia Park and The Base, in particular.
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